Oro water supply crisis looms as debts, disputes persist

WATER supply was restored in most parts of Cagayan de Oro City on Monday but the weekend crisis is far from over.

The City Government of Cagayan de Oro said it received a copy of the letter from the Cagayan de Oro Bulk Water Incorporated (Cobi) to the Cagayan de Oro Water District (COWD), the city’s sole utility firm, demanding payment of P430 million in unpaid water bills.

Cobi President Christopher Andrew Pangilinan told the COWD that unless the water district pays the bill in 30 days from the day the demand letter was sent on February 29, water will be cut off throughout the city. Cobi is the bulk supplier of treated water for COWD

The recent communiqué revealed that as of February 26, COWD remains indebted to its water supplier, Cobi, to the tune of P426,873,163.26. The outstanding balance pertains to Cobi’s invoices, with the latest one from December 2023 still not fully settled by COWD, and January 2024 invoices remaining unpaid. As of December 31, 2022, COWD has a total of 146,630 subscribers.

Cobi, in a sternly worded disconnection notice, emphasized its intention to enforce the agreed-upon rate of P20.57 cubic per meter, which had been outlined in the Bulk Water Supply Agreement between the two entities. Effective January 1, 2024, Cobi had even revised this rate upward to P24.19 per cubic meter.

However, COWD persisted in remitting payments based on a lower rate of P16.60 per cubic meter, citing pandemic-related constraints.

The disconnection notice elucidated that the Bulk Supply Agreement had been a product of mutual consent between Cobi and COWD. Cobi stressed the critical importance of timely and complete payments from COWD, which it argued were essential for the uninterrupted provision of water services.

Cobi underscored that COWD’s failure to adhere to payment schedules has impeded its ability to maintain water supply operations. Consequently, COWD was given a 30-day ultimatum to settle its outstanding dues to Cobi, failing which, the water supply would be discontinued until all financial obligations, including penalties, were met.

Mayor Rolando Uy organized a task force led by Councilor Edgar Cabanlas to investigate the transaction between the COWD and Cobi saying he had to intervene since the water crisis has already affected thousands of residents.

Mayor Uy expressed his disappointment at COWD’s failure to communicate regarding significant repairs. In response, he has established a Technical Working Group to scrutinize the terms of the 2017 agreement between COWD and Cobi.

Should this investigation reveal any detriment to the public, Mayor Uy affirmed his readiness to ask the courts to annul the agreement altogether.

“Makalolooy ang katawhan,” Uy said.

Uy said he would not hesitate to intervene if the Cabanlas-led investigation found the residents are on the short end of the transaction between Cobi and COWD.

The City Council will also conduct an investigation led by Councilor Romeo Calizo, chair of the public utilities and traffic Management this week.

“The people are duped by the two corporations when they say last weekend was a problem of repairs on the pipes but the non-payment is the real issue here,” Cabanlas said.

Last weekend, residents were left thirsty and dry after the COWD cut the water supply to at least 26 barangays in the city to repair a broken pipe distribution system.

COWD general manager Engineer Antonio Young told reporters they have to cut off the water supply to the city to allow their bulk supplier Cobi perform major repairs on a major pipe in its distribution system.

Firetrucks and water tanks from the Bureau of Fire Protection and other private companies supplied the water throughout the affected area

The row over Cagayan de Oro’s water supply is between COWD and Cobi which has interlocking ownership.

Cobi is a joint venture between Metro Pacific Water owned by businessman Manny Pangilinan and COWD, the sole water utility firm in Cagayan de Oro.

Created on August 14, 2017, Metro Pacific Water holds 95 percent equity while COWD, the remaining five percent, and the distribution and supply of water to the city.

Cobi gets its supply of bulk water from Rio Verde, a company owned by businessman Pepito Alvarez, who has a 100-million-liter-a-day water treatment facility in Baungon, Bukidnon. (With reports from Shiela Mae Butlig)